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Habitat says affordability gap persists
February 19, 2008 / 11:36 PM / 10 years ago

Habitat says affordability gap persists

<p>Actress Alyssa Milano hammers on a house frame as she helps build homes with Habitat for Humanity during the NBA Cares All-Star Day of Service in New Orleans, Louisiana February 15, 2008. As thousands of U.S. homes sit empty with no buyers, Habitat for Humanity is looking to work with banks and others to help get more lower-income families into affordable housing, the nonprofit group's chief executive said on Tuesday. REUTERS/Sean Gardner</p>

NEW YORK (Reuters) - As thousands of U.S. homes sit empty with no buyers, Habitat for Humanity is looking to work with banks and others to help get more lower-income families into affordable housing, the nonprofit group’s chief executive said on Tuesday.

Jonathan T.M. Reckford told the Reuters Housing Summit in New York that cooperation between the public, private and nonprofit sectors can help fill more homes, even though getting the various parties to the discussion table to work on solutions can be difficult.

“There’s a dearth of supply at the very affordable end of the market,” Reckford said. “Where there are opportunities, we are very eager to work with banks, with developers to see if we can get more families in these homes,” Reckford said.

Habitat, the Georgia-based nonprofit that builds and revamps homes for lower-income recipients, supports the setup of federal housing trust funds to get more people into homes, Reckford said. Such funds provide monies to help build and repair affordable housing.

Habitat provides homes to buyers who typically don’t qualify for a conventional mortgage. Habitat home owners must donate time to build homes and demonstrate that they are able to pay the nonprofit’s no-interest mortgages, he said.

Reckford said Habitat had not been directly impacted by the U.S. housing market downturn. He said Habitat provided more than 49,000 homes globally last year, nearly double the levels of two years ago.

Even though home prices have fallen sharply in some parts of the United States, Reckford said many families still do not earn enough to buy, particularly in higher-cost markets such as the east and west coasts.

“There was an affordability crisis before this downturn happened and there continues to be an affordability crisis, particularly for low and moderate-income families,” Reckford said.

Reckford, who worked in Corporate America at companies such as Circuit City Stores (CC.N) and Bain and Co. before being elected Habitat CEO in 2005, added that globally, “the issues are far more severe in terms of imbalances between income and affordability.”

Reckford said in some U.S. markets that have been hard hit by falling home prices and foreclosures, Habitat affiliates have bought homes to provide to families.

He added that rising land costs have in recent years been an impediment to providing more U.S. homes. But as builders curb construction in the current housing slump, land availability was improving, Reckford said.

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